Principles For Tnc-Sme Cooperation: The Experiences Of Unilever

Principles for TNC-SME cooperation: the experiences of UNILEVER

by Mr. André R. van Heemstra

The case for successful synergy between TNCs and SMEs is eminently strong. While the argumentspresented in this paper are of general nature, the underlying experiences, beliefs and values are those of Unilever. There are many examples across the world where Unilever can point towards mutualbenefits and, in addition, to the effect that Unilever’s co-operation with local SMEs has on the economic growth of host countries.

There are a number of pre-conditions, which help reassure theproper delivery of such mutual benefits. Firstly, TNCs must act on the basis of their own ethics rather than on ones which are externally imposed. Such principles should be well defined and should bemade public, as well as contain the essential aspiration to be an integral part of the society, to be a contributor and not an exploiter. Secondly, TNCs are well advised to see the human world asnot something monolithic and to demonstrate a high degree of cultural sensitivity. In the case of Unilever, it is the company’s ambition to be seen as a truly multi-local multinational firm. Finally,TNCs should have their eyes firmly on the long-term horizon in order to bring about an appropriate balance between give and take. On the taking side, there are the profits which are often remitted toshareholders far away. On the giving side, there are the products and services which TNCs provide, the direct and indirect employment creation, the transfer of skills and technology and finally thedemonstration of responsible care for human safety and health and for the environment.

As far as SMEs are concerned, they should display a hunger for upgrading, for help from government side, aswell as from international and private entities. Secondly, and that is a very important point, SMEs should be eager to pick up those activities which TNCs are prepared to shed. In the case of...